Google Introduces New AI-Powered Ad Formats

Google has unveiled two new AI-powered ad formats during its annual Google Marketing Live event, signaling a deeper integration of advertising into conversational search experiences. The formats, Conversational Discovery ads and Highlighted Answers, are both built on the Gemini AI model and are designed to place ads directly inside AI-generated responses and recommendation flows.

According to Google, each ad will include an independent AI explainer that synthesizes information about a product or service alongside the advertiser’s creative. All ads will continue to carry clear sponsored labels.

Conversational Discovery Ads Respond to Nuanced Prompts

The first format, Conversational Discovery ads, is tailored for detailed or exploratory queries within AI Mode. For example, Google showed a user asking how to make their home smell like “fancy spas or a rainy forest” using low-maintenance solutions.

Rather than relying primarily on keyword targeting, Gemini generates tailored creative and surfaces product features tied directly to the context of the conversation. This creates a fundamentally different type of Search interaction compared to the high-intent, single-query searches advertisers are used to optimizing for today.

These ads are built for longer, conversational prompts where users refine their needs throughout the interaction. Google has been steadily moving in this direction through AI Overviews, AI Mode testing, and earlier sponsored placements inside AI-generated experiences.

Highlighted Answers Insert Ads Into Recommendation Lists

The second format, Highlighted Answers, places ads directly inside recommendation lists generated by AI Mode. Google used the example of someone researching language learning apps before a trip. Advertisers with highly relevant ads may appear directly within those recommendations.

This moves ads closer to the recommendation itself, rather than alongside traditional Search results. For advertisers, that could mean greater visibility earlier in the research process, before users narrow down to a final decision. Google also confirmed these experiences will remain clearly labeled as sponsored and include AI-generated explainers alongside the ad.

Why This Matters for Advertisers

These updates suggest Google is pushing ads deeper into conversational Search experiences. For advertisers, that may increase the importance of creative quality, landing page content, structured product data, and first-party conversion signals.

Gemini is evaluating more than a simple keyword query. It interprets the broader context of the conversation before surfacing ads. This also creates new reporting and measurement questions. Conversational searches are far less structured than traditional keyword searches, which may make it harder for advertisers to understand which prompts, themes, or interactions actually influenced performance over time. Similar concerns have already started surfacing around AI Overviews and other AI-driven Search experiences.

Looking Ahead

Google made it clear that AI Mode is becoming a larger part of the company’s Search strategy. Conversational Discovery ads and Highlighted Answers also provide a clearer picture of how Google plans to monetize those experiences. Measurement and optimization may become far more complicated as searches become longer, more conversational, and less tied to traditional keyword behavior. Both formats are expected to be tested within AI Mode, with no confirmation yet on when they are expected to start surfacing.